(1) Each risk classification is assigned to a hazard group, as shown in WAC 296-17-901. To determine your hazard group, we will first multiply your standard premiums in each risk class by the hazard group index for that risk class. This is called the adjusted standard premium. Hazard group indices are shown in subsection (3) of this section. We will then divide the total adjusted standard premiums by your total standard premiums, rounded to three decimal places to determine your average hazard index. We will assign you to a hazard group based on your average hazard index using the table in subsection (4) of this section.

(2) We will determine your size group based on your standard premiums using the table in WAC 296-17B-900.

(3) Hazard group index table.

(4) Average hazard index table.

Example:

• For your retrospective enrollment year, your group has exposure in risk classifications with Hazard Groups 3 and 6 and corresponding standard premiums of $1,000,000 and $2,000,000 during the enrollment year.

• The Average Hazard Index value for your group is the total adjusted standard premiums divided by the total standard premiums or $2,410,000/$3,000,000 = 0.803 to three decimal places. This value 0.803 is in the range between 0.685 and 0.909.

• Therefore, your group will be assigned Hazard Group Number 5 during this annual adjustment.